Presentation Transcript

1. Financial Aid Award Letters and Shopping Sheets

   Presenter: Dan Mann University of Illinois at Urbana-Champaign
2. Background Higher Education Opportunity Act enacted August 14, 2008, required the Secretary of Education to convene a group to make recommendations to improve financial aid offer letters. A public meeting was held in Washington, DC on September 13, 2011, to discuss this issue with more than 50 people in attendance.
3. Background At the same time, others were expressing the need for more standardization of financial aid award letters: Senator Al Franken (Understanding the True Cost of College Act – Introduced May 2012) Mark Kantrowitz Students/Parents
4. NASFAA Award Notification and Consumer Information Task Force
5. Identified Themes A well-presented, easy-to-understand financial aid award notice is critical and should be a top priority for all financial aid offices. Standardization of the content, terminology and definitions contained in an award notice is critical. Flexibility in the format of the award notice is critical so that institutions can best leverage whatever delivery method is available and best suits their particular student population.
6. Task Force Recommendations The NASFAA Task Force developed six recommendations falling into four categories: Core Elements of an Award Letter Standardized Award Letter Terminology Loan Aggregator and Calculator Student Consumer Information
7. Task Force Recommendations Recommendation #1 Include ten core elements on every award notification.
8. 10 Core Elements of Award Letter Cost of Attendance Scholarship and Grant Awards (Gift Aid) Net Costs After Gift Aid Self-Help Options (Loans and Employment) Assumptions Prior Loan Debt Link to Consumer Information Disclosures Link to Standard Terms and Definitions Contact Info for the Financial Aid Office Deadlines and Next Steps
9. Cost of Attendance The federally defined Cost of Attendance (COA) should be listed on every award letter or notification to students. Estimated charges for tuition and mandatory fees Room and board (for on-campus residents) Estimated living expenses (for off-campus residents) Estimated transportation costs Estimated book and supplies costs Estimated miscellaneous costs
10. Standardized Terminology To provide colleges community-defined and accepted definitions of common terms used on institutional award notifications. To provide greater clarity and understanding by students through consistency in the use and meaning of terms on award notifications from all colleges and universities. To allow prospective students to more easily compare information from multiple schools.
11. Standardized Terminology(Further Details in Appendix A of Report) Cost of Attendance Direct Costs Indirect Costs Net Cost Out-of-Pocket Cost Family Financial Responsibility Expected Family Contribution Gift Aid Grant Scholarship Educational Loan Federal Work-Study FSEOG Federal Pell Grant Enrollment Status Enrollment Level Verification
12. Task Force Recommendations Recommendation #2 The components of the Cost of Attendance should be broken down into two clearly labeled classifications: Direct Costs Indirect Costs
13. Cost of Attendance Direct Costs Tuition and fees Room and Board (for on-campus residents) Total direct costs Indirect Costs Room and board (for off-campus residents) Books and supplies Transportation Miscellaneous costs Total indirect costs
14. Task Force Recommendations Recommendation #3 Students should be informed of the potential debt they may incur at a college before paying the enrollment deposit.
15. Task Force Recommendations Recommendation #4 Award notifications should provide enrolled students with their cumulative loan history (federal and private) and the ability to calculate repayment estimates before they borrow additional loans.
16. Task Force Recommendations Recommendation #5 The U.S. Department of Education should mandate that all educational loans from private lenders as well as from colleges and universities be reported to one central database.
17. Task Force Recommendations Recommendation #6 Each award notification should include a link to a school-created web resource that contains links to student consumer information and resources.
18. Student Consumer Information(Further Details in Appendix B of the Report) Loan Counseling Cumulative Indebtedness Student Loan Default Rate Repayment Information Financial Aid Terms Federal Student Loan History College Navigator Net Price Calculator Non-Federal Student Loan History (Once the Resource is Available) College Scorecard
19. Financial Aid Shopping Sheet
20. Financial Aid Shopping Sheet Previously referred to as the “Model Financial Aid Award Form” and as “Know Before You Owe”. Schools can voluntarily decide to use this consumer tool beginning with the 2013-14 award year to notify students about their financial aid package.
21. Financial Aid Shopping Sheet Information presented in a standardized format that is designed to simplify the information that prospective students receive about costs and financial aid so that they can easily compare institutions and make informed decisions about where to attend. 1,607 institutions have voluntarily adopted the Shopping Sheet as of September 2013.
22. Financial Aid Shopping Sheet Executive Order 13607 – GEN-12-17 “In carrying out the principles of E.O. 13607, an institution commits to provide the Shopping Sheet to veterans and service members before they decide to attend the institution. This might be accomplished most easily by providing the Shopping Sheet to all students.”
23. Financial Aid Shopping Sheet Shopping Sheet Layout Section 1 – Student Information Section 2 – Institutional Metrics Section 3 – Institution Contact Information
24. Financial Aid Shopping Sheet
25. NASFAA Consumer Testing of Financial Aid Award Letters
26. Consumer Testing NASFAA contracted independent research firm JBL Associates, Inc. to conduct consumer testing: Shopping Sheet Award Letter Based on Recommendation from the NASFAA Task Force Hybrid of the Shopping Sheet and NASFAA Task Force Award Letter
27. Consumer Testing Focus groups were conducted in three geographically diverse locations with students and parents at the high school level, and in colleges across all institution types. Tested for comprehension and the following: Level of clarity in each letter Features they found helpful or confusing Suggestions for improvement
28. Consumer Testing Overall, there was no clear winner! Both students and parents felt overwhelmed and confused by the information presented.
29. University of Illinoisat Urbana-Champaign
30. University of Illinoisat Urbana-Champaign Chartered in 1867, is the flagship institution in State of Illinois One of the top-ranked public universities in the nation 17 Colleges; 160+ programs of study Fall 2013 Enrollment – 43,398 Students 32,294 undergraduates 10,080 graduates 1,024 professionals
31. University of Illinoisat Urbana-Champaign Federal Methodology (FM) is used to determine financial need and award institutional funds. Need-based aid is targeted to our neediest students. Include PLUS Loans in our financial aid package. Require “active” acceptance of all loan and work awards. Awards are not negotiable. A special circumstance process is in place for significant changes in the family’s financial situation.
32. University of Illinoisat Urbana-Champaign Students are not packaged until verification is complete and all requirements met. We do not provide “estimated” award letters. Net Price Calculator was updated and made available on March 15, 2013, with 2013-14 costs and packaging logic for students wanting estimated award information. Our NPC is designed to provide accurate costs and financial aid packages based on the data entered. This process works well for us!
33. University of Illinoisat Urbana-Champaign
34. University of Illinoisat Urbana-Champaign
35. University of Illinoisat Urbana-Champaign
36. University of Illinoisat Urbana-Champaign All financial aid award letters are electronic (no paper). Students must certify that they have read our Financial Aid Terms and Conditions. Once awards are accepted, links are provided for all outstanding requirements (loan counseling, promissory notes, etc.) The Financial Aid Award Letter application provides options for students to request changes and report additional financial aid. Students like our process and it works well!
37. University of Illinoisat Urbana-Champaign
38. University of Illinoisat Urbana-Champaign Financial Aid Shopping Sheet was implemented in March 2013 and electronic for all students who have been packaged (no paper). Our approach has been to make the Shopping Sheet available, but to continue to stress the importance of completing the Financial Aid Award Letter. We have received very few questions about the Shopping Sheet.
39. So where do we go from here?
40. Thoughts/Questions?
41. Thanks for your participation!